Changing target during time of inflationary fears could be dangerous Dismisses talk of dual mandate for BOE On CNBC, Charlie Evans wants to allow inflation to drift up toward 3%, versus the Fed’s 2.0% informal inflation target.
Global outlook makes inflation undershoot more likely, spare capacity could make inflation slow quicker CPI will fall back to sharply over next 6 months and be 2% by end 2012. CPI would be under 2% barring VAT and energy effects
…as expected rate maintained at 0.5%, leaves asset purchases at £275 bln Cable jumps to a day’s high of 1.5945 on the BOE announcement, before settling back around 1.5935
The calendar is generally vacant this week but one event stands out – Thursday’s Bank of England decision. The strong consensus is that the MPC will stay on the sidelines after last month’s €75B increase to the Asset Purchase Program. … Continue reading
Decision may depend on financial market strains Sizable chance of more asset buying
Legislators have to define ring-fencing of banks, not regulators BOE only wants to implement regulatory systems that are judgement based “Completely baffled” by EU commission’s desire to impose maximum capital requirements on banks
Let’s be honest, it hasn’t done a great deal for the whole of the past year.
They are the missing key, not stepping up for growth Many feel ECB QE is inevitable. All they would have to do is stop sterilizing the bond purchases on a weekly basis. Draghi indicated today that the ECB will continue … Continue reading
Difficult to securitize loans to small business, commercial banks should assess small business credit risks Treasury is capable of giving incentives to banks to lend to small businesses, BOE doesn’t have the tools.